Asset Protection:

Safeguarding What You’ve Worked Hard To Build

When families think about financial planning, most focus on growing their wealth—through savings, investments, or retirement plans. But just as important as building assets is protecting them. Without proper safeguards, a lifetime of hard work can be eroded by unexpected risks such as lawsuits, medical emergencies, long-term care costs, or poor planning. Asset protection ensures that your money, property, and legacy are shielded, allowing your family to enjoy the security you’ve built.

Why Asset Protection Matters

In the United States and Canada, families often underestimate how quickly assets can be depleted. Rising healthcare costs, taxes, market volatility, and legal liabilities all pose threats. For instance:

  • The U.S. Federal Reserve’s Survey of Consumer Finances (2022) found that nearly 1 in 4 families experienced a financial shock—such as job loss or medical expense—that significantly reduced their net worth.

  • Genworth’s 2023 Cost of Care Survey reported that long-term care can cost upwards of $108,000 per year for a private nursing home, often draining retirement savings within a few years if not planned for.

Asset protection planning is not just for the wealthy—it’s for anyone who wants to ensure that their financial foundation supports their family across generations.

Key Strategies for Asset Protection

  1. Insurance as a Safety Net

Insurance is the first line of defense. Health, life, long-term care, and disability insurance protect against sudden expenses that might otherwise erode savings. For example, Long-Term Care Insurance (LTCI) helps cover care costs without forcing families to sell assets or deplete retirement accounts.

2. Retirement and Investment Planning

Structuring retirement accounts wisely can protect assets from unnecessary taxes and inflation. Tools like IRAs, 401(k)s, or RRSPs (in Canada) offer tax advantages while ensuring money grows securely for the future. Diversification across investments also spreads risk and reduces vulnerability.

3. Legal Structures and Trusts

For families with property, businesses, or significant assets, trusts and legal entities can shield wealth from probate, lawsuits, or mismanagement. For example, a revocable living trust allows assets to pass smoothly to heirs while avoiding costly and time-consuming court processes.

4. Estate Planning

Estate planning ensures assets are distributed according to your wishes, not left to legal disputes. Clear wills, beneficiary designations, and power of attorney arrangements all play critical roles in keeping wealth intact.

Benefits of Asset Protection to Families

  • Financial Security: Families are less likely to face sudden financial ruin from unexpected events.

  • Peace of Mind: Parents and caregivers know their loved ones will be taken care of.

  • Stability Across Generations: Children inherit not just assets, but stability, minimizing intergenerational financial burdens.

  • Control and Choice: Proper planning gives families the freedom to decide how assets are used and transferred.

References:

Federal Reserve. (2022). Survey of consumer finances 2022. Board of Governors of the Federal Reserve System. https://www.federalreserve.gov/econres/scfindex.htm

Genworth. (2023). Cost of care survey 2023. Genworth Financial. https://www.genworth.com/aging-and-you/finances/cost-of-care.html

U.S. Department of Health and Human Services. (2023). How much care will you need? Administration for Community Living. https://acl.gov/ltc/basic-needs/how-much-care-will-you-need